Christiansen v. Christiansen, 18132

• Decision Date: 23 June 1983
• Docket Number: No. 18132,18132
• Parties: Jana C. CHRISTIANSEN, Plaintiff and Respondent, v. Kent CHRISTIANSEN, Defendant and Appellant.
• Court: Utah Supreme Court

Page 592

667 P.2d 592

Jana C. CHRISTIANSEN, Plaintiff and Respondent, v. Kent CHRISTIANSEN, Defendant and Appellant.

No. 18132.

Supreme Court of Utah.

June 23, 1983.

Craig M. Snyder, Provo, for defendant and appellant.

Allen K. Young, Provo, for plaintiff and respondent.

STEWART, Justice:

This is an appeal from a modification of a divorce decree. The trial court granted a petition by plaintiff for increased child support, denied a cross-petition by defendant for decreased alimony, and awarded $200 in attorney's fees to plaintiff. We affirm.

Defendant is a dentist specializing in root canal therapy. Plaintiff has a master's degree in educational psychology. They were married in 1972 at the completion of defendant's undergraduate degree. They have two children by their marriage, who at the time of the modification hearing were ages three years and eighteen months.

In July 1979 the parties were divorced. The divorce decree gave custody of the children to plaintiff and required defendant to (1) pay to plaintiff monthly alimony of $650 and monthly child support of $275 per child; (2) maintain hospital and medical insurance policies in full force on plaintiff and the two children; and (3) pay to plaintiff a lump sum of $16,000.

At the time of the divorce decree, plaintiff was unemployed and had no source of support other than defendant. Since then plaintiff has been working three days a week as an educational psychologist for the Provo School District, although she suffers from a rather serious case of rheumatoid arthritis. Her net monthly income is $550, but her job has required her to spend $250 per month for child care while she is away from home. The funding for the job she holds is somewhat tenuous because of tight budgetary problems in the school district.

In 1981 plaintiff petitioned for an increase in child support. She alleged increased expenses for housing, child care, transportation, food, clothing, and other expenses. Defendant opposed the motion and cross-petitioned for a decrease or elimination of alimony because of plaintiff's new source of income. Defendant also cross-petitioned for termination of his obligation under the divorce decree to maintain medical insurance on plaintiff.

The trial court found that plaintiff had shown "changed circumstances" by virtue of increased housing payments, additional child care expenses of $250 per month, and inflation. The court also found that the defendant had an increased ability to provide child support, stating:

[D]efendant has increased his gross income considerably since the Decree of Divorce was entered [into] when his net income was approximately $30,000.00 per year. His present mode of doing business through a personal corporation and payment of a salary is not indicative of the real earnings of the defendant..... [A]n increase of approximately $19,000.00 has been established in the gross earnings in the 1980-81 period.

The court's finding that defendant's mode of doing business "is not indicative of the real earnings of the defendant" is based on a substantial discrepancy between the defendant's real earnings through his corporation and his corporate salary. Although we cannot determine exactly the basis of the trial court's finding on income, the record provides support for the finding that defendant was benefited by at least as much as the court found, if not more. In 1980 the corporation earned $141,535 in gross income. From that, defendant received a salary of $38,000. The remainder was paid out for various expenses. Part of those expenses, however, benefited the defendant in a personal way: $31,000 was paid to an employee benefit program, at least part of which, if not all, was for the benefit of the defendant, and $790 was paid out for a car allowance. Added to defendant's salary, and his interest income of $5,300, these benefits show defendant's personal income to have increased to in excess of $19,000, even after personal income tax is deducted.

The trial court awarded an increase in child support of $175 per child per month. The court denied defendant's request for a decrease in alimony, finding that "a sufficient change of circumstances has not been shown to justify the reduction or elimination of the alimony paid by defendant to plaintiff." Finally, the court did not rule on defendant's request to be relieved of payments to maintain medical insurance coverage on plaintiff, and awarded the plaintiff $200 in attorney's fees.

On appeal, defendant argues that the trial court erred in (1) granting the increase in child support; (2) denying a decrease in alimony; (3) not terminating his obligation to maintain medical insurance for plaintiff; and (4) awarding attorney's fees to plaintiff.

To provide stability to divorce decrees, we have ruled that a party seeking a modification of support obligations must show a substantial change of circumstances. E.g. Adams v. Adams, Utah, 593 P.2d 147 (1979). The nature of the required change in circumstances varies with the type of modification sought. Foulger v. Foulger, Utah, 626 P.2d 412 (1981).

In our review of divorce and child support proceedings, this Court accords substantial deference to the trial court's findings of fact, and accords it considerable latitude in fashioning appropriate relief. Fletcher v. Fletcher, Utah, 615 P.2d 1218 (1980); Cox v. Cox, Utah, 532 P.2d 994 (1975); Mitchell v. Mitchell, Utah, 527 P.2d 1359 (1974); Harding v. Harding, 26 Utah 2d 277, 488 P.2d 308 (1971). This deference applies as much to findings in a modification proceeding as to findings in the initial divorce decree. McCrary v. McCrary, Utah, 599 P.2d 1248 (1979); Mitchell v. Mitchell, supra. Thus in Mitchell v. Mitchell, supra, at 1361, we stated: "The determination of the trial court that there has been a substantial change of circumstances, which justified the increase of support and maintenance, is presumed valid.

In the present case, the evidence adequately supports the finding of changed circumstances. First, the defendant has significantly increased his ability to provide support to plaintiff. Although the record does not establish the exact increase in defendant's net income, his gross income in 1980-81 increased by at least $19,000. Second, plaintiff's reasonable expenses for care of the children have increased substantially. For child care alone she spends an additional $125 per child per month. Both factors--the husband's increased ability to pay and the wife's increased expenses--are appropriate to consider in determining whether there are changed circumstances. Gramme v. Gramme, Utah, 587 P.2d 144 (1978); English v. English, Utah, 565 P.2d 409 (1977). See also Mitchell v. Mitchell, supra. Although an increase in the husband's income does not automatically justify an increase in his child support obligations, it is an important factor to be considered. Owen v. Owen, Utah, 579 P.2d 911 (1978); Wells v. Wells, Okl., 648 P.2d 1223 (1982).

Defendant argues that the trial court should not have considered an increase in corporate income when determining his personal ability to pay. This Court has held, however, that where an ex-husband has a wholly-owned corporation, a trial court may consider both his individual income and the corporation's income in considering a petition by the divorced wife for modification of alimony and child support. Garrand v. Garrand, Utah, 581 P.2d 1012 (1978). Also, defendant argues that the trial court improperly considered his gross earnings, when only net are relevant. It appears from the record, however, that the trial judge did consider the net value of the increase in gross earnings, for at the end of the hearing he requested for review defendant's individual and corporate tax returns.

Defendant also argues that plaintiff's increased expenses are more than offset by plaintiff's increased income of $550 per month from her new job. That increase, however, compared with increased expenses for the children and the increase in defendant's income, is small. When a divorced husband's income has increased substantially and his former wife's income has increased much less and the needs of the children have also increased, it is equitable that the husband pay increased child support.

The facts of this case are substantially similar to the facts of other cases where increased child support has been ordered. In MacDonald v. MacDonald, 30 Or.App. 99 566 P.2d 542 (1977), the father's gross annual income had increased from about $10,000 to $21,000, and the mother's from about $6,500 to $13,000, over a ten year period. The trial court's increase in child support from $110 to $200 per month was sustained. See also Beddoes v. Beddoes, 155 Colo. 115, 393 P.2d 1 (1964) (improvement in mother's financial condition did not warrant decrease in child support); In re Winner, 58 Or.App. 597, 649 P.2d 611 (1...